Elpida, Chinese firm to set up joint venture to produce DRAMs

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Elpida Memory Inc said Wednesday it will establish a joint company in the Chinese city of Suzhou later this year to produce dynamic random access memory chips. The joint venture is due to launch production sometime in January-March 2010 with a monthly capacity of the equivalent of 40,000 300-millimeter wafers. It plans to double the output eventually, with a planned total capital spending of some $5 billion.

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Elpida, which is the sole Japanese DRAM maker, will invest about 30 billion yen in the new unit for a 39% stake. The remainder will be held by Suzhou Venture Group Co, a Chinese venture capital, and other parties. The joint venture will be Elpida’s first production base in mainland China. The company expects DRAM demand to expand in the Chinese market in line with robust personal computer demand which is expected to grow at a double-digit annual rate.

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